El Salvador may issue a national stablecoin

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El Salvador’s central bank may issue a national stablecoin pegged to the US dollar at a 1: 1 ratio and backed by dollar reserves.

According to the El Faro publication, journalists were given access to a video meeting in which the brothers of President Salvador Nayib Bukele took part. They are not part of the government, but often advise the head of state. According to them, by next year, the country could launch a national stablecoin pegged to the US dollar.

The stablecoin will be called “Colón-Dollar”, a reference to the country’s national currency, which was replaced by the US dollar in 2001. A government spokesman said the plan to issue a stablecoin has been canceled. However, “a source familiar with the situation” claims that the authorities are in fact continuing to develop.

Government meetings on the issue took place after Bukele recognized bitcoin as legal tender in the country in June. High-level government officials, private contractors and external advisers participated in the discussions. The president’s brothers Ibrajim and Yusef Bukele said they would like all cryptocurrencies to be recognized as legal tender in El Salvador.

“But for this to happen, we need a public infrastructure that meets the challenges of the future,” Ibrahim Bukele said.

According to a recent report by JPMorgan analysts, the use of BTC in the El Salvadorian economy is facing obstacles, which indicate possible “restrictions” on the use of the cryptoasset as a means of payment.

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